RENO, Nev., March 6, 2007 (PRIME NEWSWIRE) -- Battle Mountain Gold Exploration Corp. (OTCBB:BMGX) ("Battle Mountain") and Royal Gold, Inc. (Nasdaq:RGLD) (TSX:RGL) and today announced that Battle Mountain has accepted Royal Gold's proposal to acquire 100% of the fully diluted shares of Battle Mountain for approximately 1.57 million shares of Royal Gold common stock in a merger transaction. This represents a value of $0.60 per fully diluted share of Battle Mountain, or a 29% premium to the 20-day weighted average trading price of Battle Mountain as of Friday, February 23, 2007. The proposal is subject to satisfactory completion of due diligence, definitive documentation, and receipt of a fairness opinion satisfactory to Royal Gold's Board of Directors, among other conditions.
To ensure continuity of Battle Mountain's business, Royal Gold and Battle Mountain also entered into a binding term sheet, as of February 28, 2007, to provide up to $20 million in bridge financing to satisfy debt obligations and finalize royalty acquisitions. The bridge loan is convertible into Battle Mountain common stock at the election of Royal Gold, at $0.60 per share.
Tony Jensen, Royal Gold's President and CEO, stated, "This transaction will further diversify our portfolio of producing royalties and strengthens our pipeline of development-stage assets, with the Dolores project expected to commence production later this year. We are pleased with both the near-term and long-term financial impacts this transaction will have on Royal Gold and will continue to remain vigilant in our search for further accretive opportunities."
Mark Kucher, Battle Mountain Chairman and CEO, commented, "We are pleased to combine our assets with the premier precious metal royalty company in the business. Royal Gold has the experience, talent and resources to continue to provide an excellent return for our shareholders."
In anticipation of this transaction, Royal Gold has obtained a binding support agreement and option to purchase approximately 18% of the outstanding common stock of Battle Mountain from Mark Kucher, which provides that he will vote for and support the transaction. Royal Gold and Battle Mountain also entered into a binding agreement providing for a 45-day exclusive period to conclude definitive documentation for the merger and providing for break-up fees payable to Royal Gold in the event Battle Mountain enters into a competing agreement with another party within twelve months. There is also a mutual break-up fee payable in the event that either party breaches the agreement.
About Royal Gold
Royal Gold is a precious metals royalty company engaging in the acquisition and management of precious metal royalty interests. Royal Gold is publicly-traded on the NASDAQ Global Select Market under the symbol "RGLD," and on the Toronto Stock Exchange under the symbol "RGL." The Company's web page is located at www.royalgold.com.
About Battle Mountain
Battle Mountain is a precious metals royalty company with a portfolio consisting of 12 properties located mainly in the Americas. Their principal assets include a 1.25% net smelter return ("NSR") royalty on gold production from the Dolores project in Mexico, under development by Minefinders Corporation Ltd. Battle Mountain also has an option to acquire an additional 2.0% NSR royalty on gold and silver production from the Dolores project. Including the option, Battle Mountain's properties contain approximately 4.8 million ounces of gold reserves and 136 million ounces of silver reserves. (For an overview of Battle Mountain's royalty portfolio refer to Attachment A)
On behalf of the Board of Directors,
Mark Kucher Chairman and CEO
To learn more please visit www.bmegold.com or email info@bmegold.com.
Battle Mountain Exploration Gold Corp. Sixth Floor, Suite 9 One East Liberty Street Reno, Nevada 89504
Safe Harbor for Forward-Looking Statements: This release contains certain "forward-looking statements" as defined by the Private Securities Litigation Reform Act of 1995, including, without limitation, expectations, beliefs, plans and objectives regarding the potential transactions and ventures discussed in this release. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are the risks inherent in mineral exploration, the need to obtain additional financing, the availability of needed personnel and equipment for future exploration and development, fluctuations in the price of minerals, and general economic conditions.
FOR INVESTOR INFORMATION PLEASE CALL 1-800-436-0167
Appendix A
Battle Mountain Gold Exploration's Royalty Portfolio
Properties with Proven and Probable Ore Reserves(1),(2)
----------------------------------------------------------------------
Property Location Ownership NSR Status
Rate %
----------------------------------------------------------------------
Williams Mine Ontario Teck Cominco 0.72 Operating
(50%),
Barrick Gold
(50%)
----------------------------------------------------------------------
Don Mario Mine Bolivia Orvana Minerals 3.0 Operating
----------------------------------------------------------------------
El Limon Mine & Nicaragua Glencairn Gold 3.0 Operating
La India Resource (95%),
Inversiones
Mineras S.A.
(5%)
----------------------------------------------------------------------
Joe Mann Mine Quebec Campbell 1.00(4) Operating
Resources
----------------------------------------------------------------------
Dolores Project Mexico Minefinders 1.25(4) Operations
to begin
2007
----------------------------------------------------------------------
Dolores Project Mexico Minefinders 2.05(5) Operations
to begin
2007
----------------------------------------------------------------------
----------------------------------------------------------------------
Property Metal Tons/ Average Grade Contained
Tonnes (opt/gpt) Ounces(3)
(millions) (millions)
----------------------------------------------------------------------
Au Ag Au Ag
-----------------------------
Williams Mine Gold 19.5/17.7 0.076/ -- 1.49 --
2.62
----------------------------------------------------------------------
Don Mario Mine Gold and 7.2/6.5 0.087/ 1.14/ 0.62 8.2
Silver 2.97 39.2
----------------------------------------------------------------------
El Limon Mine & Gold 1.4/1.3 0.156/ -- 0.22 --
La India Resource 5.34
----------------------------------------------------------------------
Joe Mann Mine Gold 0.08/0.07 0.214/ -- 0.02 --
7.35
----------------------------------------------------------------------
Dolores Project Gold 110.5/100.2 0.022/ -- 2.45 --
0.76
----------------------------------------------------------------------
Dolores Project Gold and 110.5/100.2 0.022/ 1.16/ 2.45 127.8
Silver 0.76 39.7
----------------------------------------------------------------------
Total Reserves 4.8 136.0
-----------------------------
Appendix A (continued)
Battle Mountain Gold Exploration's Royalty Portfolio
Development and Exploration Properties
---------------------------------------------------------------------
Property Location Ownership NSR Status
Rate %
---------------------------------------------------------------------
Sega Resource Burkina Faso Orezone 3.06(6) Resource
Resources Development
---------------------------------------------------------------------
Relief Canyon Nevada Firstgold 4.0 Exploration
---------------------------------------------------------------------
Fletcher Nevada Pediment Gold 1.25 Exploration
Junction
Project
---------------------------------------------------------------------
Hot Pot Project Nevada Pediment Gold 1.25 Exploration
---------------------------------------------------------------------
Marmato Colombia Mineros 5.0 Exploration
Properties Nacionales S.A.
---------------------------------------------------------------------
Night Hawk Ontario Selkirk Metals 2.5 Exploration
Lake Property (40%), East West
Resource (40%),
Canadian Golden
Dragon (20%)
---------------------------------------------------------------------
Lluvia de Mexico Columbia Metals, 2.0 Care and
Oro Mine Tara Gold Maintenance
Resources
---------------------------------------------------------------------
---------------------------------------------------------
Property Metal Tons/ Average Grade
Tonnes (opt/gpt)
(millions) Au
---------------------------------------------------------
Sega Resource Gold -- --
---------------------------------------------------------
Relief Canyon Gold -- --
---------------------------------------------------------
Fletcher Gold -- --
Junction
Project
---------------------------------------------------------
Hot Pot Project Gold -- --
---------------------------------------------------------
Marmato Gold -- --
Properties
---------------------------------------------------------
Night Hawk Lake Base -- --
Property Metals
---------------------------------------------------------
Lluvia de Gold -- --
Oro Mine
---------------------------------------------------------
(1) Set forth below are the definitions of proven and probable
reserves used by the U.S. Securities and Exchange Commission.
Some of these royalty operators are Canadian issuers. Their
definitions of "mineral reserve," "proven mineral reserve" and
"probable mineral reserve" conform to the Canadian Institute of
Mining, Metallurgy and Petroleum definitions of these terms as
of the effective date of estimation as required by National
Instrument 43-101 of the Canadian Securities Administrators.
"Reserve" is that part of a mineral deposit which could be
economically and legally extracted or produced at the time of
the reserve determination.
"Proven (Measured) Reserves" are reserves for which (a) quantity
is computed from dimensions revealed in outcrops, trenches,
workings or drill holes, and the grade is computed from the
results of detailed sampling, and (b) the sites for inspection,
sampling and measurement are spaced so closely and the geologic
character is so well defined that the size, shape, depth and
mineral content of the reserves are well established.
"Probable (Indicated) Reserves" are reserves for which the
quantity and grade are computed from information similar to that
used for proven (measured) reserves, but the sites for
inspection, sampling and measurement are farther apart or are
otherwise less adequately spaced. The degree of assurance of
probable (indicated) reserves, although lower than that for
proven (measured) reserves, is high enough to assume geological
continuity between points of observation.
(2) This information is derived from publicly-available information
from the operators of the properties and Battle Mountain Gold
Exploration's National Instrument 43-101 reports.
(3) "Contained ounces" are 100% of the reserves subject to the
royalty interests and do not take into account losses in
processing the ore.
(4) Royalty applies to gold production only.
(5) Battle Mountain holds an option to acquire a 2% NSR royalty
which applies to both gold and silver.
(6) Orezone has the right to buy back up to 2.0% of the royalty for
$2 million.